Market Overview - The S&P 600 Small Cap Index has increased by 2.0% year-to-date, with a notable return of 5.8% since July, indicating a positive trend for small-cap stocks [1] - Global economic indicators are currently favorable for small-cap stocks, contributing to their upward trajectory [1] Currency and International Dynamics - The weakening U.S. dollar and rising global yields are driving gains in international equities, leading investors to favor international small caps due to a wide valuation gap [2] - Small caps are seen as offering significant upside potential in both valuation and diversification [2] Federal Reserve Influence - The Federal Reserve's plan to cut interest rates is viewed positively for small-cap stocks, as historically, falling interest rates have benefited these stocks more than large-cap stocks [4] - From 1966 to 2023, the S&P 500 returned 16.4% during periods of rate cuts compared to only 6.2% during rate hikes, highlighting the favorable conditions for small-cap stocks in a declining rate environment [4] Small-Cap Stock Recommendations - **Aehr Test Systems**: Year-to-date performance of 55.7%, positioned well in the semiconductor sector with strong momentum in AI and semiconductor testing [6] - **Travelzoo**: Year-to-date performance of -49.7%, seen as undervalued with healthy cash flow and potential for recovery as consumer travel increases [8][9] - **Jazz Pharmaceuticals**: Year-to-date performance of -9.8%, recently received FDA approval for a new cancer treatment and has a promising pipeline with strong analyst support [10][11][12] Investment Strategy - First-time investors in small-cap stocks should exercise caution, using limit orders and diversifying their portfolios to mitigate risks [13] - A long-term investment horizon of at least three years is recommended, as small caps can experience significant annual drawdowns [13] - Maintaining discipline in investment strategies, such as rebalancing and avoiding chasing momentum, is crucial for success in small-cap investing [14]

Company Performance - Allegiant Travel reported quarterly earnings of $1.23 per share, exceeding the Zacks Consensus Estimate of $0.83 per share, but down from $1.77 per share a year ago, representing an earnings surprise of +48.19% [1] - The company posted revenues of $689.38 million for the quarter ended June 2025, missing the Zacks Consensus Estimate by 1.29%, compared to $666.28 million in the same quarter last year [2] - Over the last four quarters, Allegiant Travel has surpassed consensus EPS estimates three times and topped consensus revenue estimates three times [2] Stock Performance and Outlook - Allegiant Travel shares have declined approximately 48.9% since the beginning of the year, while the S&P 500 has gained 6.1% [3] - The current consensus EPS estimate for the upcoming quarter is -$1.62 on revenues of $599.03 million, and for the current fiscal year, it is $2.70 on revenues of $2.67 billion [7] - The estimate revisions trend for Allegiant Travel was unfavorable ahead of the earnings release, resulting in a Zacks Rank 4 (Sell) for the stock, indicating expected underperformance in the near future [6] Industry Context - The Transportation - Airline industry, to which Allegiant Travel belongs, is currently in the top 37% of over 250 Zacks industries, suggesting a favorable outlook compared to the bottom 50% [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors [5]

Core Insights - Sun Country Airlines Holdings, Inc. (SNCY) reported quarterly earnings of $0.14 per share, exceeding the Zacks Consensus Estimate of $0.12 per share, and showing an increase from $0.06 per share a year ago, resulting in an earnings surprise of +16.67% [1] - The company achieved revenues of $263.62 million for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 3.59% and up from $254.38 million year-over-year [2] - Sun Country Airlines has outperformed consensus EPS estimates in all four quarters over the past year and has topped revenue estimates three times in the same period [2] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $0.22 on revenues of $248.78 million, while the estimate for the current fiscal year is $1.34 on revenues of $1.1 billion [7] - The stock currently holds a Zacks Rank 3 (Hold), indicating expected performance in line with the market in the near future [6] Industry Context - The Transportation - Airline industry, to which Sun Country Airlines belongs, is currently ranked in the bottom 40% of over 250 Zacks industries, which may impact stock performance [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, suggesting that investors should monitor these revisions closely [5]

Group 1: Company Performance - Trip.com closed at $60.54, down 1.5% from the previous trading session, underperforming the S&P 500's loss of 0.07% [1] - The company is expected to report EPS of $0.99, a decrease of 1% year-over-year, with revenue projected at $2.03 billion, an increase of 15.73% from the prior-year quarter [2] - For the full year, earnings are expected to be $3.6 per share and revenue at $8.48 billion, reflecting changes of +0.28% and +14.41% respectively from last year [3] Group 2: Analyst Estimates and Valuation - Recent adjustments to analyst estimates for Trip.com indicate evolving short-term business trends, with positive revisions suggesting analyst optimism [4] - The Zacks Rank system, which assesses estimate changes, currently ranks Trip.com at 3 (Hold), with a Forward P/E ratio of 17.07, indicating a discount compared to the industry average of 21.79 [6] - Trip.com has a PEG ratio of 2.54, higher than the Leisure and Recreation Services industry's average PEG ratio of 1.91 [7] Group 3: Industry Context - The Leisure and Recreation Services industry, part of the Consumer Discretionary sector, holds a Zacks Industry Rank of 67, placing it in the top 28% of over 250 industries [8]

Company Performance - Allegiant Travel (ALGT) shares increased by 6.2% to close at $58.37, with notable trading volume compared to typical sessions, contrasting with a 0.4% loss over the past four weeks [1] - Scheduled traffic for May rose by 10.2% year over year, while capacity increased by 16.3% year over year, and total departures rose by 16.2% compared to the previous year [2] - The company is expected to report quarterly earnings of $0.84 per share, reflecting a year-over-year decline of 52.5%, with revenues projected at $697.4 million, up 4.7% from the same quarter last year [3] Earnings Estimates and Trends - The consensus EPS estimate for Allegiant Travel has remained unchanged over the last 30 days, indicating that stock price movements may not sustain without trends in earnings estimate revisions [4] - The stock currently holds a Zacks Rank of 3 (Hold), suggesting a neutral outlook [5] Industry Context - Allegiant Travel operates within the Zacks Transportation - Airline industry, where another competitor, Southwest Airlines (LUV), saw a 3% increase in stock price, closing at $33.41, despite a -2% return over the past month [5] - Southwest Airlines has a consensus EPS estimate of $0.52, which is a 10.3% decline from the previous year, and also holds a Zacks Rank of 3 (Hold) [6]

Company Performance - Trip.com reported quarterly earnings of $0.82 per share, missing the Zacks Consensus Estimate of $0.86 per share, and showing a slight decrease from $0.83 per share a year ago, resulting in an earnings surprise of -4.65% [1] - The company posted revenues of $1.91 billion for the quarter ended March 2025, which was below the Zacks Consensus Estimate by 0.25%, but an increase from $1.65 billion year-over-year [2] - Over the last four quarters, Trip.com has surpassed consensus EPS estimates three times and topped consensus revenue estimates two times [2] Stock Outlook - Trip.com shares have declined approximately 5.4% since the beginning of the year, contrasting with the S&P 500's gain of 1.3% [3] - The current consensus EPS estimate for the upcoming quarter is $1.01 on revenues of $2.04 billion, and for the current fiscal year, it is $3.44 on revenues of $8.45 billion [7] - The estimate revisions trend for Trip.com is mixed, leading to a Zacks Rank 3 (Hold), indicating expected performance in line with the market in the near future [6] Industry Context - The Leisure and Recreation Services industry, to which Trip.com belongs, is currently ranked in the top 36% of over 250 Zacks industries, suggesting a favorable outlook compared to lower-ranked industries [8]

Group 1: Earnings Performance - United Parks & Resorts reported a quarterly loss of $0.29 per share, which was worse than the Zacks Consensus Estimate of a loss of $0.23, and compared to a loss of $0.17 per share a year ago, indicating a significant earnings surprise of -26.09% [1] - The company posted revenues of $286.95 million for the quarter ended March 2025, missing the Zacks Consensus Estimate by 2.37%, and down from $297.42 million in the same quarter last year [2] - Over the last four quarters, the company has not surpassed consensus EPS estimates and has topped revenue estimates only once [2] Group 2: Stock Performance and Outlook - United Parks & Resorts shares have declined approximately 16% since the beginning of the year, contrasting with the S&P 500's decline of -3.8% [3] - The current consensus EPS estimate for the upcoming quarter is $1.69 on revenues of $500.75 million, and for the current fiscal year, it is $4.36 on revenues of $1.73 billion [7] - The estimate revisions trend for United Parks & Resorts is currently unfavorable, resulting in a Zacks Rank 4 (Sell), indicating expected underperformance in the near future [6] Group 3: Industry Context - The Leisure and Recreation Services industry, to which United Parks & Resorts belongs, is currently ranked in the bottom 35% of over 250 Zacks industries, suggesting a challenging environment for stock performance [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact investor sentiment and stock performance [5]

Core Viewpoint - Groupon reported a significant earnings beat in Q1 2025, with earnings of 18 cents per share, surpassing the Zacks Consensus Estimate by 190% and improving from a loss of 33 cents per share in the same quarter last year [1] Financial Performance - Revenues for the quarter were $117.2 million, exceeding the consensus estimate by 1.46%, but reflecting a year-over-year decline of 4.8% [2] - North America revenues were $91.11 million, beating the consensus by 2% but down 3.2% year-over-year; International revenues were $26.07 million, missing the consensus by 3.09% and down 9.9% year-over-year [2] - Local revenues totaled $108.4 million, beating estimates by 3.28% but declining 2.6% year-over-year; North America Local revenues decreased 0.6%, while International Local revenues fell 9.4% [3] - Consolidated Travel revenues were $5.05 million, missing estimates by 21.57% and down 20.5% year-over-year; North America Travel revenues decreased 20.4% [4] - Goods revenues were $3.78 million, missing estimates by 10.33% and declining 31.6% year-over-year; North America Goods revenues fell 50.9% [5] Customer Metrics - Groupon had approximately 15.5 million active customers at the end of Q1, down from 16.1 million year-over-year but beating the consensus estimate by 5.66%; North America had about 10.5 million active customers, exceeding estimates by 6.38% [6] Operating Details - Consolidated gross profit fell 3.9% year-over-year to $106.3 million, with North America gross profit down 1.5% and International gross profit down 9.4% [7] - Gross margin improved by 90 basis points to 90.7%; Selling, general and administrative expenses decreased by 6% to $69.84 million, while marketing expenses rose by 19.5% to $34.4 million [7] - GAAP operating profit was $1.88 million, down from $7.37 million year-over-year; adjusted EBITDA declined 21.5% to $15.3 million [8] Balance Sheet & Cash Flow - Groupon ended the quarter with cash and cash equivalents of $226.8 million, slightly down from $228.8 million at the end of 2024 [9] - Operating cash inflow remained stable at $67 million, while free cash outflow was $3.8 million compared to a free cash inflow of $63.2 million in the previous quarter [10] Guidance - For Q2 2025, Groupon expects revenues between $121 million and $123 million, indicating a year-over-year decline of 3-1%; adjusted EBITDA is projected to be between $14 million and $17 million [11] - For the full year 2025, the company anticipates revenues between $493 million and $500 million, reflecting a year-over-year growth of 0-2%; adjusted EBITDA is expected to be between $70 million and $75 million [12] - Groupon expects a positive free cash flow of at least $41 million for 2025 [13]

Core Viewpoint - Lifetime Brands (LCUT) reported a quarterly loss of $0.25 per share, which was worse than the Zacks Consensus Estimate of a loss of $0.14, indicating a significant earnings surprise of -78.57% [1][2] Financial Performance - The company posted revenues of $140.09 million for the quarter ended March 2025, missing the Zacks Consensus Estimate by 3.07% and down from $142.24 million a year ago [2] - Over the last four quarters, Lifetime Brands has surpassed consensus EPS estimates only once [2] - The company's shares have declined approximately 44.3% since the beginning of the year, compared to a -4.3% decline in the S&P 500 [3] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is -$0.14 on revenues of $139.54 million, and for the current fiscal year, it is $0.30 on revenues of $677.27 million [7] - The estimate revisions trend for Lifetime Brands is mixed, resulting in a Zacks Rank 3 (Hold), suggesting the stock is expected to perform in line with the market in the near future [6] Industry Context - The Consumer Products - Discretionary industry, to which Lifetime Brands belongs, is currently ranked in the bottom 24% of over 250 Zacks industries, indicating potential challenges ahead [8]

Company Performance - Trip.com (TCOM) closed at $61.22, reflecting a +1.21% change from the previous day, outperforming the S&P 500, which fell by 0.77% [1] - Over the last month, Trip.com's shares increased by 12.96%, while the Consumer Discretionary sector gained 14.18% and the S&P 500 gained 11.54% [1] Earnings Projections - The upcoming EPS for Trip.com is projected at $0.86, indicating a 3.61% increase year-over-year [2] - Revenue is expected to reach $1.91 billion, representing a 15.93% increase compared to the same quarter last year [2] Fiscal Year Estimates - For the entire fiscal year, earnings are estimated at $3.44 per share, a decrease of 4.18% from the previous year, while revenue is projected at $8.45 billion, an increase of 14.02% [3] - Recent changes in analyst estimates are seen as indicators of the company's business outlook [3] Valuation Metrics - Trip.com has a Forward P/E ratio of 17.57, which is lower than the industry average of 18.53, indicating a discount [6] - The company has a PEG ratio of 1.08, compared to the industry average of 1.42, suggesting favorable valuation relative to growth [7] Industry Context - The Leisure and Recreation Services industry, part of the Consumer Discretionary sector, has a Zacks Industry Rank of 182, placing it in the bottom 27% of over 250 industries [8] - Stronger industry rankings correlate with better stock performance, with top-rated industries outperforming lower-rated ones by a factor of 2 to 1 [8]